Delay analysis is too pivotal to disputes to remain shrouded in mystery or to be left to the experts. Here’s what you must understand about the four main techniques …
Delay analysis is not boring or difficult. No, really, it isn’t. True, there are lots of techniques and some of the jargon has an air of mystique, but it can be made more user-friendly. First let me tell you a story (no names are mentioned, because it’s fictional):
A contractor had a delay claim. The contractor’s lawyer advised it to instruct a programming expert to perform a delay analysis. Unfortunately, the expert recommended a method of analysis that did not demonstrate the contractor’s entitlement under the contract. The lawyer didn’t spot this because he hadn’t considered the issue when reading the contract. This was a technical matter and delay is for the experts to deal with, isn’t it? And the expert hadn’t read the contract because she was not a lawyer.
The legal and expert fees came to £500,000 by the time someone noticed, at which point the lawyer and the expert had to start all over again. The contractor was not amused.
If you want to avoid that sort of mess, you need to know about delay analysis techniques and how they connect with contractual provisions on delay and extensions of time. Here is my guide to four commonly used techniques:
As-planned versus as-built
This method takes the planned sequence and timing of work and compares them to the actual sequence and timing. It does not necessarily use a critical path or separate out the effects of delaying events. It has its uses on simple projects, where there may be little difficulty in seeing which activities drive the completion date. However, in terms of demonstrating that events actually led to delay, it is of limited value.
Moreover, if the contractor is entitled to an extension of time for delay to completion, it may not be able to show that a delayed activity early in a project actually delayed completion because it does not employ a critical path.
This technique takes the contractor’s planned programme as the base line. It then introduces the effects of delays for which the employer has adopted the risk under the contract. Once these events have been “impacted”, it shows their predicted effect on completion. In theory the contractor should be entitled to an extension of time for their effect and will be responsible for any difference between the impacted and the actual completion date.
This type of analysis is highly theoretical.
Unfortunately, the expert recommended a method of analysis that did not demonstrate the contractor’s entitlement under the contract
One occasionally sees cases where it bears no relationship to what the contractor did on site.
It predicts the effect of each event rather than looking at what happened. That means this technique is only suitable if the contract entitles the contractor to an extension for likely delay as well as for actual delay, as with the JCT forms.
Time impacted analysis
Sometimes called snapshot or windows analysis, this looks at the effect of a delay on the planned programme at the time the event occurs. Clearly, the planned programme needs to take account of progress at the time an delay occurs. The effects of events are then plotted on updated as-planned programmes. If you don’t update the programme it won’t reflect the then state of progress. However, this method takes little account of what happens in between each “snapshot” so other factors causing delay can be overlooked.
As-built but-for analysis
Also known as collapsed as-built analysis, this system starts by identifying the actual sequence of the works. Events that are at the employer’s risk under the contract are identified and extracted from the as-built programme to show how long the work would have taken, but for the events at the employer’s risk. A common criticism of the method is the subjective element involved in determining the critical path through the as-built programme. On the other hand, it seems to get closer to the facts than other methods.
None of these techniques is perfect. All involve different degrees of artificiality. Once you recognise that, it’s just a matter of knowing your onions – and reading the contract.
In my next article I’ll look at why nobody can agree which of these techiques to use.